OAG Travel News

There can be few greater contrasts than the current strategies of the Middle East’s airlines and those of the world’s major network carriers.

Old-school airlines, such as American Airlines, Delta, British Airways and Virgin Atlantic, are cutting back on the services they operate and trimming their networks. Meanwhile carriers in the Gulf region that have only existed for a few years, such as Qatar Airways and Etihad Airways, are expanding massively and placing huge orders for new aircraft.

For example, Qatar, founded only 12 years ago, will operate a fleet of 110 aircraft by 2013, up from 68 now. Overall, the airline has more than 200 aircraft on order.

As a result, it is expanding its route network dramatically. At the end of this month, a new service will open between Doha and Houston. It has also announced new direct services from Doha to Sydney and Melbourne.

The airline’s chief executive, Akbar Al Baker, says it continually identifies new opportunities around the world and can easily shift capacity according to market conditions. “Qatar Airways does not rely on traffic from any specific markets, so we are largely immune from the circumstances surrounding the current economic meltdown.”

Abu Dhabi-based Etihad, which only launched in 2003, announced firm orders for 100 Airbus and Boeing aircraft and options for up to 105 more last year. Its intentions are clear from its new route launches last year – to Beijing, Minsk, Almaty, Kozhikode, Madras and Moscow.

Emirates, launched in 1985, is set to become the world’s biggest operator of Airbus’s A380. Its order for 58 of the jets makes it by far the biggest customer for the European builder’s superjumbo. Last July, FlyDubai, a new no-frills arm of the Emirates Group, said it was ordering no fewer than 54 Boeing 737-800s to develop a low-cost network in the region.

Even Gulf Air, previously hamstrung by its multinational ownership and multiple-hub structure, is expanding after the Bahrain Government took over as sole shareholder.

What these Middle Eastern carriers are trying to do is create new global hubs to rival the traditional European hubs of London Heathrow, Amsterdam Schiphol, Paris Charles de Gaulle and Frankfurt, and the global hubs of Hong Kong and Singapore.

Dubai looks set to have the world's largest airport, part of the enormous Dubai World Central development.

The first runway has already been built at Al Maktoum International, which has a planned capacity of 120 million passengers a year. To put this in perspective, the world’s busiest airport, Atlanta Hartsfield-Jackson, handled 90 million in 2008 while Heathrow handled 67 million.

Meanwhile, work on a new Doha International airport began in 2004 and it is set to open fully by mid2011. It will have a capacity of 50 million by 2015. Abu Dhabi is also expanding and will be able to handle 20 million passengers by late 2011.

But will their strategy work? Andrew Solum of Travel Industry Associates, a regular traveller on the region’s airlines, says: “These carriers offer an interesting proposition providing you are going east from the UK to SouthEast Asia or Australia but not if you are going across the North Atlantic or to South America. They also don’t really serve Northern Asia, places like Tokyo, terribly well.”

The question also remains whether there will be sufficient demand to fill all these new aircraft and airports. With the global economy in down-turn, finding enough travellers to fill 58 A380s is going to challenge even the most optimistic of airlines.

Source: www.timesonline.co.uk report by Mark Frary